Managerial Accounting: E9-19 Triway Packaging Corporation manufactures and sells

Managerial Accounting 
E9-19 Flexible Performance Report in a Cost Center 
Triway Packaging Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of direct labor-hours worked in a month. 
Direct labor $16.30q 
Indirect labor $4,300 + $1.80q 
Utilities $5,600 + $0.70q 
Supplies $1,400 + $0.30q 
Equipment depreciation $18,600 + $2.80q 
Factory rent 8,300 
Property taxes 2,800 
Factory administration $13,400 + $0.90q 
The actual costs incurred in November in the Production Department are listed below: 
Actual Cost Incurred in November 
Direct labor 63,520 
Indirect labor 10,680 
Utilities 8,790 
Supplies 2,810 
Equipment depreciation 29,240 
Factory rent 8,700 
Property taxes 2,800 
Factory administration 16,230 

1. The company had budgeted for an activity level of 4,000 labor-hours in November. Complete the Production Department’s planning budget for the month. 
2. The company actually worked 3,800 labor-hours in March. Complete the Production Department’s flexible budget for the month. 
3. Prepare the Production Department's flexible budget performance report for November, including both the activity and spending variances. 
4. What aspects of the flexible budget performance report should be brought to management's attention? Explain.
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